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Saturday, 14 May 2016

Reason why fuel price will crash like Sim Cards pricing

The leadership of the All Progressives Congress APC says the new N145
pump price of petrol will crash within thhe next three months. In a
media briefing with newsmen in Abuja yesterday May 13th, the Chairman
of the party, John Odigie-Oyegun, says just like the Global System of
Mobile telecommunication, GSM, the price of fuel is bound to reduce
due to competitive market forces.
According to him:
"From our point of view as a party, it has become necessary to fully
and in order to recover from the economic situation which we have been
plunged to totally free the economy and let the normal laws of demand
and supply operate. Of course, with government standing by to protect
the long suffering Nigerian who is at the margin. If is unfortunate,
it is painful what has happened, it will increase cost in all
directions. But in the medium term, in three months at best, I foresee
that the prices will come crashing down when there is availability.
NNPC will continue to be in the field anyway either through the
refineries whenever our pipelines are allowed to function or through
importation and so will continue to be a player in the fuel supply
market. Prices are bound to come down. A typical example is what
happened when mobile phones were introduced. I remember that I bought
a SIM card for over N30,000, but today, it is virtually free. If we
free the fuel market, that same thing will happen which was as a
result of competition is likely to happen. "Over time, the subsidy
regime has become so intensely manipulated, so abused that it really
was no longer operating in the interest of the Nigerian public.
I think that it has become very clear that the kind of queues that has
become endemic over several regimes in this nation is a clear
indication that something has gone seriously wrong with the subsidy
regime. Those who were privileged were exploiting it to amass more
wealth. Meanwhile, the people for whom it was basically meant had to
bear the cost in higher transport fare. Each time these queues
develop, of course the ordinary Nigerian bears the cost while the
importers and manipulators of the system are the ones that makes all
the money. If the region of subsidy is to be reintroduced, it can only
divert resources from the crying needs of other sectors, including the
programme to help the Nigerians living at the margin. So, the appeal
which is a very sincere appeal to the Nigerian people; yes there is a
lot of hardship, yes increased pump price will also increase that
hardship.
But the economy is being freed in a way that the ordinary Nigerian
will become the major beneficiary and we are talking of a matter of
months from removing this one last bottleneck that has held the
Nigerian economy down. So, it is an appeal and we should watch what
happen in the next few months as far as the fuel issue is concerned
because I am sure it will come crashing down. In any case, it will
free resources eventually that will be used to create good jobs which
has been promised and improve the lot of the Nigerians at the margin.
That is the message the party wants to convey. The economy is in bad
shape as a result of which our people are going through hard times",
he said